Maurice Cummins (Fine Gael) | Oireachtas source

I welcome the Minister of State. The Finance Bill before the House contains all of the provisions announced in the budget a month ago. Many of those provisions are to be welcomed. In its recent report, the National Competitiveness Council highlighted the fact that higher tax rates being paid by workers are militating against our competitiveness. Both the budget and the Finance Bill are designed to support employment and job creation. We have witnessed the results of the Government's policies in this regard during the past 20 months, with unemployment levels falling. Earlier in the week it was announced that the unemployment rate has been reduced to 10.7%. We recognise that this is still too high but it is a considerable improvement on the position heretofore.

The measures relating to the USC and tax improve the progressiveness of the taxation system. As a result of the budget and the provisions contained in the Bill before the House, 80,000 people will no longer be obliged to pay the USC. Over 400,000 people have been spared the obligation to pay this contribution since the Government came to office. It is absolutely ridiculous that people on €32,800 were previously obliged to pay the top rate of tax. The threshold in this regard is being increased. I accept that what is being done is not enough but it is a step in the right direction. The Minister for Finance has indicated that he intends to increase the threshold even further in forthcoming budgets. I have spoken to a number of graduates who are living abroad at present and they informed me that the low level at which the higher rate of income tax kicks in is preventing them from returning to Ireland. However, I welcome the progress being made in this area.

Senator Barrett referred to petrol stretching and diesel laundering. The penalties do not fit the crime in this instance. They are simply not sufficient. We are talking here about subversive activities against the State which prevent the accrual of tax to the Exchequer. Those involved are earning fortunes from the despicable practices in which they engage. These individuals should be put out of business. As far as I am concerned, the penalties which obtain are insufficient and should be increased significantly.

I welcome the home renovation incentives that are included in the Bill. The extension of those incentives to rental properties is certainly a welcome development, particularly as it will provide a boost to the construction industry. Since the incentives in question were first put in place a year ago, that industry has already received a fillip.

Measures relating to the living city initiative have been contained in the past two or three budgets. I understand Europe is delaying the implementation of this tremendous initiative, which will certainly boost many of our cities. What is the current position with regard to the living city initiative? What is being done in Europe to expedite matters and clear the blockage relating to this laudable project? We were previously informed that this matter would be dealt with this year but now we are informed that it will take another couple of months. What is the current status of the initiative?

The Finance Bill is progressive in nature and contains some good news. We are all aware of the very difficult news with which people were obliged to deal in recent years in the context of previous Finance Acts and budgets. We are, however, beginning to reap the benefits from the decisions that were taken. The economy has returned to growth and employment rates are falling because people are getting back into employment. It is to be hoped that prosperity will filter down to people throughout the country in the 11 months prior to the next budget. The Government is prepared to do even more in that budget than was the case with that which was introduced a month ago.